Australian Unity invests offshore
The Melbourne financial services company will be a 50 per cent partner in Seres Asset Management, which was founded by Evan Erlanson and Dr Ken Lu.
Erlanson was formerly senior managing director at Bear Stearns Asia until this year, while Dr Lu was managing director of APAC Capital.
The head of Australian Unity Investments, David Bryant, said the global financial crisis had created opportunities for smaller fund managers to expand.
“The crisis set up the opportunity as these calibre of people are only around for a short period of time,” he said.
“Although it was a difficult time, Australian Unity made the investment decision to take advantage of the opportunity.”
Seres will take an active approach to investing in Chinese, Korean and Taiwanese equities.
Bryant said India would probably be the next country added to the portfolio followed by other Asian countries such as Vietnam and Japan.
The Melbourne operation will provide seed capital, help with compliance and product development, eventually offering an Asian equities fund to Australian investors.
After a tough 2009 financial year that saw revenue for the investment business fall from $63 million in 2008 to $59.4 million, Bryant said it had turned around.
Funds under management at June 30 was $5.8 billion, but this had risen to $7.6 billion at the end of August, and in mid-September stood at $8 billion.
“All I can say about the past 12 months was it was extraordinary difficult,” Bryant said.
“But I think investment markets have stabilised and this year we will see a steadier market.”
The downturn in the investment division also added to a dramatic fall in Australian Unity’s after tax profits.
The company finished the 2009 financial year with a $1.1 million profit compared to $32.3 million in 2008.
Australian Unity group managing director Rohan Mead said the company’s exposure to financial markets had reduced revenue, which hit the bottom line.
“Although our profit is down, I am pleased the way the company has weathered the storm,” he said.
“It is fair to say I prefer this financial year to the past financial year.”
Australian Unity also took an $8 million hit for extraordinary items such as the Lifeplan merger.
Recommended for you
Licensing regulation should prioritise consumer outcomes over institutional convenience, according to Assured Support, and the compliance firm has suggested an alternative framework to the “licensed and self-licensed” model.
The chair of the Platinum Capital listed investment company admits the vehicle “is at a crossroads” in its 31-year history, with both L1 Capital and Wilson Asset Management bidding to take over its investment management.
AMP has settled on two court proceedings: one class action which affected superannuation members and a second regarding insurer policies.
With a large group of advisers expecting to exit before the 2026 education deadline, an industry expert shares how these practices can best prepare themselves for sale to compete in a “buyer’s market”.
